With the new Companies Act, the option of a Close Corporation has FALLEN AWAY. Many customers want to know what the difference is between a Private Company (Pty) and a Close Corporation (CC). Both have certain benefits, but also drawbacks. Here are some of the differences but we suggest that you seek professional advice before deciding…
Close Corporation has FALLEN AWAY – R500 to register a PTY (LTD) Company
Companies we have registered to date :
Strydom Conglomerate PTY (LTD) – 2018/240861/07 – Henti Strydom – 076 405 6575
BWF Kitchens PTY (LTD – 2018/283377/07 – Belinda Olivier – 061 540 7789
Serenity Movement PTY (LTD) – 2018/290059/07 – Gugu Zondie – 060 459 1781
RodFen Auto Tech PTY (LTD) – 2018/253045/07 – Rodney Fenell – 079 794 2972
Sekha Tech PTY (LTD) – 2018/292047/07 – Tebogo Sekhaolelo – 061 209 1804
ANNUSCHKE THERON CONSULTANTS PTY (LTD) – 2018/318492/07 – 081 049 7515
Both Close Corporations (CC) and Private Companies (Pty) count as a legal entities and have limited liability of members or shareholders.
Close Corporations are often the type of company chosen by small business owners. CCs have members – up to a maximum of 10 natural people. The number of employees, however, is not limited. An accounting officer/ bookkeeper needs to be appointed, but generally the rules for governance of a CC are slightly more relaxed. For example, CCs do not need to convene an AGM.
Useful Video on Small Business Tax 101 – A Basic South African Guide
Private Companies consist of directors and shareholders (up to 50 shareholders). Companies can also qualify as shareholders. The shareholders own the company and appoint directors (which may be shareholders) to run it for them. There cannot be more than 50 shareholders and shares may not be offered to the general public. A private company needs the services of an auditor/ chartered accountant although there are some exclusions. Also, Private Companies need to hold an AGM and the cost to register is higher.
A close corporation is generally a smaller corporation that elects close corporation status and is therefore entitled to operate without the strict formalities normally required in the operation of standard corporations. Many small-business owners find this benefit invaluable.
